Obama at Alcoa, Promotes Technology and Togetherness

ByEmily Hoerner, Jonathan Stefonek, and Guannan Huang |June 28, 2011

As President Barack Obama took to the bully pulpit at Alcoa Davenport Works Tuesday afternoon, massive aluminum spools of plate metaling and more than a mile of warehouse filled the vacant space behind him.

Some of that space also housed some $90 million in new investment for equipment that Obama used as a symbol for his belief that a rejuvenated manufacturing sector would help lead the country to economic recovery.

“Think about that,” Obama said to about 200 of Alcoa’s more than 2,000 workers. “That’s what made you guys competitive, having the best workers but also having the best equipment. You had to up your game, and that’s what we’ve got to do as a country as whole.”

The visit was arranged in part to promote Obama’s Advanced Manufacturing Partnership, which began in Pittsburgh earlier this month and is aimed at higher quality manufacturing businesses like Alcoa, which uses new technologies to stay competitive nationally and globally.

Part Pep Talk, Part Politics

People wait outside the venue for President Obama. Photo by Guannan Huang

The visit was in good measure a pep rally with distinct political significance. For Obama, who faces no well-known opposition from Democrats, he’s looking ahead to the general election. He carried Iowa comfortably in the 2008 election.

His remarks Tuesday came at a time when the public is still focused on a persistent unemployment problem, when the state is already immersed in presidential campaigning for the 2012 Iowa Caucus and when it is crawling with national media that was covering Republican candidate Michelle Bachmann in Waterloo on Monday and Sarah Palin in Pella later in the day Tuesday.

Nonetheless, Obama used the fortuitous circumstances to showcase his view that the key to restoring the job market can be found in a re-invented technological manufacturing sector that hums and glistens with new technology.

While acknowledging that new technology can devastate the employment scene, Obama says it can also bring new jobs that require new skills. When those new skill-demands are linked to a new community college training program, which the Obama administration announced three weeks ago, new technology, he said, can help replace the old jobs that employed skills no longer needed. The new program, he said, would allow 500,000 students to “earn industry-accepted credentials for manufacturing jobs that companies are looking to fill.”

The Alcoa Davenport Works is part of the company’s advanced engineering division, developing sheet alloys for use in the aeronautics and defense industries. Last week Alcoa did well at the Paris Air Show, signing a $1 billion, multi-year deal with French aircraft manufacturer Airbus.

Even Obama said he personally used products made by Alcoa, like the wings of Air Force One.

“In Afghanistan and Iraq, you’ve helped provide our troops with the armor they need to protect their vehicles from roadside bombs or IED’s,” Obama said to the crowd.

Laid Off Workers Return

After mass layoffs, Alcoa has brought back hundreds of workers.

“There was a lot of hardship,” said Gary Miller, 22-year Alcoa employee as we waited in line outside the factory where he works, “now, you see a lot of happy people.”

President Barack Obama in Davenport, Iowa. Photo by Guannan Huang

In April 2009, Alcoa announced it would begin to layoff of what would eventually be around 500 employees, over a fifth of its workforce. This past September the plant hosted its first job fair in two years.

“They’re all back plus a couple hundred,” said Joe Owens, a plate mill worker of 14 years.

“It looks like we’re going to be doing plenty of overtime.” From a low of 1,600 workers, Alcoa is back to a full staff of 2,200 with the last of the new hires starting work in August.

Before rehiring began, many employees received federally supported education and training, said Brad Greve, who has worked at Alcoa for 32 years. Some of those former Alcoa employees took their skills to different careers, while some brought it back to the Alcoa plant. “There’s physical work out here, but there’s a lot of equipment run on computers and there were people who probably benefited that way too.”

The Quad Cities has an especially large array of manufacturers like John Deere and Alcoa that have done well amidst rough economic times.

Manufacturing May Not Be Recovery Key

But the manufacturing sector in the rest of state is not quite so bright.

David Swenson, an Iowa State University associate economics scientist, said Iowa has only gained back about 15 percent of the manufacturing jobs it lostsince the recession. The Quad Cities, on the other hand, has recovered over half of those losses.

“[Obama’s] going to go to a place that is reinventing itself. where anything he does to promote manufacturing is going to be perceived very well by the local economy,” Swenson said.

That reinventing process at Alcoa helped it bring back many of the workers it had laid off in the depths of the recession, and Obama noted the company, after a redesign, regained much of a market in a type of sheet metal it made.

“Sometimes the old ways of doing things just won’t cut it anymore,” he said. “See, when change happens, you’ve got a choice. You can either keep on doing what you’re doing and hope things work out, or you can make the decision that you can not only meet the challenges of the future, but that you can set the pace.”

He provided a blueprint for expanding the manufacturing sector by bringing community colleges and businesses together. Businesses can let community colleges know exactly what types of manufacturing jobs are needed, and schools can then train workers for those specific positions.

But Swenson warned that new technology can also mean less manufacturing jobs in the long run.

“Ever since manufacturing began, it has shed jobs. With modern manufacturing, they hate labor. They shed jobs like crazy,” he said. Although Swenson noted that losing jobs doesn’t mean the state’s economy suffers.

Iowa Governor Terry Brandstad. Photo by Guannan Huang

He said the goal is for the industry to be competitive and hire the most skillful and productive people but to expect long term job increases is unrealistic.

Tim Hagle, a University of Iowa associate professor of political science, said he saw problems with the president’s investment ideas.

“Businesses are weary about investing in an uncertain environment,” Hagle said.

Gov. Terry Branstad said the Obama healthcare plan in particular has caused uncertainty in the business environment as well.

“So I just think what I hear from businesses is we need to eliminate the uncertainty, and we need to have a pro-trade policy,” he said. “We need to aggressively look at how we can open up new markets, as well as reduce some of the impediments in the regulatory and tax field that prevent American businesses from competing.”